Stocks rise as investors cheer hiring trends

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U.S. stocks rose sharply in afternoon trading Friday as
investors found bright spots in the government’s monthly employment
report, including solid growth in construction and manufacturing jobs.
Expedia and several other companies rose after reporting higher earnings
than analysts were expecting.
The gains added to a strong finish for stocks a day earlier and had the market on track to notch a slight
gain for the week.
KEEPING
SCORE: The Dow Jones industrial average rose 153 points, or 1 percent,
to 15,782 as of 3:13 p.m. Eastern time. The Standard & Poor’s 500
index added 20 points, or 1.2 percent, to 1,794. The Nasdaq composite
gained 61 points, or 1.5 percent, to 4,118.
WEAKER JOB GROWTH: The
Labor Department said early Friday that U.S. employers added 113,000
jobs last month, less than the average monthly gain of 194,000 in 2013.
This follows December’s tepid increase of just 75,000. Job gains have
averaged only 154,000 the past three months, down from 201,000 in the
preceding three months. Still, the latest data also showed that
manufacturers, construction firms and mining and drilling companies
added strong 76,000 jobs combined, a strong showing.
INVESTORS REACT: Stocks initially turned lower right after the jobs data came out, then quickly reversed
course.
"The
market had a tough time figuring out what to do with the (jobs) number
when it first came out," said J.J. Kinahan, chief strategist with TD
Ameritrade. "As the day went on, it just kind of discounted some of the
negatives in there to say, ‘What do we really want? We want a growing
economy, and these are the jobs we got for a growing economy."
UNEMPLOYMENT
FALLS: The government also reported that the nation’s unemployment rate
dipped to 6.6 percent in January from 6.7 percent in December. It was
the lowest rate since October 2008.
BROADER GROWTH TREND INTACT?
Some market watchers interpreted the latest job numbers as not
necessarily indicative of the overall strength of the U.S. economy and
job market, citing the likely impact of unusually harsh weather that
battered much of the East Coast this winter. "This was heavily
influenced by cold weather in January and should not be viewed as a
break in the trend," said Tim Hopper, chief economist at financial
services company TIAA-CREF.
U.S. EARNINGS: Online travel service
Expedia soared $9.67, or 14.8 percent, to $74.84 after reporting that
its profit and revenue jumped on increased hotel bookings and revenue
from a new venture. LinkedIn fell $12.90 or 5.8 percent, to $210.50
after the company said its performance may falter this year as it spends
more on long-term projects and revenue growth slows. Fairway, a grocery
store chain, plunged $3.24, or 28.3 percent, to $8.19 after it reported
a loss in its fiscal third quarter and said its CEO is stepping down.
CALMER
WATERS: After a turbulent start to the week, did the jobs data give
investors reason to feel better? Hard to say. The upward trajectory of
stocks Friday is an encouraging sign, said Brad Sorensen, director of
market and sector analysis at the Schwab Center for Financial Research.
"It doesn’t mean there’s not more downside over the next week or two,"
he said.
BUYING BONDS: The yield on the 10-year Treasury note
edged down to 2.68 percent from 2.70 percent as investors moved money
into bonds. It slid as low as 2.63 percent shortly after the jobs report
came out at 8:30 a.m. Eastern time. The yield, which affects rates on
mortgages and other consumer loans, had been edging higher after falling
to 2.58 percent on Monday, the lowest level in more than two months.
TURNAROUND
WEEK: The market dug itself a hole at the start of the week, plunging
more than 2 percent on Monday. But stocks were on track to finishing
slightly ahead for the week. The Dow was up 0.5 percent for the week,
while the S&P 500 was heading for a 0.7 percent bump.
IN THE
GREEN: The gains were broad. All 10 sectors in the S&P 500 index
moved higher, led by industrial and health care stocks. Three stocks
rose for every one that fell.
BON VOYAGE: Online travel sites were
soaring in afternoon trading. In addition to Expedia, TripAdvisor leapt
$8.03, or 10.4 percent, to $85.17.
MOVING ON UP: Among the stocks
posting sizable gains were publishing company News Corp., which rose
$1.34, or 8.4 percent, to $17.36. The Gap also added $2.44, or 6.1
percent, to $42.15.
SLIDING DOWN: Cigna led the roster of
decliners in the S&P 500 after reporting earnings that fell short of
analysts’ expectations. The company sank $7.92, or 9.3 percent, to
$77.45. Also sliding was Flir Systems, which makes thermal imaging
systems. It shed $1.69, or 5.3 percent, to $30.50.
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